Time Finance plc (LON:TIME), the AIM listed independent specialist finance provider, has announced its unaudited interim results for the six-months ended 30 November 2023. The Interims reflect continued strong demand from businesses across the UK for the range of alternative finance products offered by the Group.
Financial Highlights:
· Own-Book lending origination up 29% to £47.3m during H1 2023/24 (H1 2022/23: £36.6m)
· Gross lending-book up 24% to a record £188.6m as at 30 November 2023 (30 November 2022: £152.7m)
· Revenue up 19% to £15.7m (H1 2022/23: £13.2m)
· Profit before Tax (“PBT”) up 35% to £2.7m (H1 2022/23: £2.0m)
· Earnings Per Share up 35% to 2.33 pence per share (H1 2022/23: 1.73 pence per share)
· Net deals in arrears remain stable at 6% of the lending book as at 30 November 2023 (30 November 2022: 6%)
· Net Assets up 7% to £63.9m as at 30 November 2023 (30 November 2022: £59.7m)
· Net Tangible Assets up 13% to £36.4m as at 30 November 2023 (30 November 2022: £32.1m)
· Strong visibility of future earnings with unearned income up 26% to £23.9m as at 30 November 2023 (30 November 2022: £18.9m)
· Continued positive trading momentum throughout December 2023 gives significant confidence that full year trading will be at least in line with Board expectations
Commenting on the Interim Results, Tanya Raynes, Non-Executive Chair, said:
“These results show that our focus on own-book lending continues to deliver a strong trading performance. This is particularly encouraging given the wider economic headwinds and demonstrates UK SMEs’ robust demand for funding from a truly customer-focussed, multi-product provider of finance like ourselves. The strategic positioning of the Group within the market has enabled it to generate increasing levels of demand whilst also maintaining control of credit and spread risk. As a result, the Group is well positioned to deliver further growth and increased value to our shareholders. We look forward to being able to report on further progress at the year-end.”
CHIEF EXECUTIVE OFFICER’S STATEMENT
FOR THE SIX-MONTH PERIOD ENDED 30 NOVEMBER 2023
Introduction
Time Finance plc is a multi-product alternative finance provider to UK SMEs. It is primarily a lender for the working capital requirements of UK businesses, but it can also act as a broker in arranging funding where more appropriate. It comprises two core, own-book divisions – Asset Finance and Invoice Finance – with lending proposals originated through a variety of channels. These include finance brokers and other professional firms, equipment vendors, suppliers and dealers, and direct from borrowers. Its target market is generally those business who have a funding requirement between £5k and £3.5m.
Financial Results
I am pleased to report this set of Interim financial results with good progress, both strategically and financially, having been made in the first half of the financial year; building on the solid foundations laid in the previous financial year.
Own-Book deal origination is a key performance indicator for the Group. Pleasingly, in the six-month period to 30 November, this origination amounted to £47.3m, an increase of 29% when compared to the six months to 30 November 2022. This increase has helped contribute to the Group’s gross lending book growing to record highs. As at 30 November 2023 it stood at £188.6m compared to £152.7m twelve months earlier. An increasing own-book lending portfolio is key to the Group’s strategy as it underpins future income generation and profitability and, in turn, the inherent value of the balance sheet.
It is also encouraging to see that all the key metrics on the Profit and Loss account – Revenue, Gross Profit and Profit Before Tax – show growth from both the preceding six-month period to 31 May 2023 and the six-month comparative period to 30 November 2022. Given the compound nature of the Asset and Loan finance businesses, all other things being equal, this gives the board confidence for the future performance.
With regard to the Group’s Balance Sheet, the quality of the lending portfolio is another key performance indicator and focus of the Board. It is extremely pleasing, therefore, to report a stability in make-up of the book despite the wider economic difficulties. As at 30 November 2023, net arrears as a percentage of the lending book had remained static at approximately 6% as was the position twelve months earlier.
The Group’s increasing level of deal origination, lending portfolio management and continued support from external funders have all combined to further strengthen the Group’s balance sheet. Net Tangible Assets stood at £36.4m as at 30 November 2023 compared to £32.1m as at 30 November 2023, an increase of 13%.
Strategy and Outlook
The Group remains committed to its four-year medium-term strategy which was introduced in June of 2021 as it firmly believes this will lead to increased shareholder value over time. The focus on our key initiatives – core product own-book lending, investing in improved IT infrastructure to enable the business to scale more easily and maximising our multi-product offering – continues apace.
Taking into account the wider macro-economic and geo-political concerns, the Board is pleased with these interim financial results and also with the operational progress made during the first half of the current financial year. The strategic plan remains on-track and the Group has continually shown its operational resilience and balance sheet strength throughout. As a result, and whilst remaining vigilant and cautious as to the potential impact that further economic uncertainty could have on the Group, the Board is confident that the results for the full-year will be at least in-line with current Board expectations.
Ed Rimmer
Chief Executive Officer, Time Finance plc
